Third Age Health Annual Report – Amendment
26 June 2023
Amendment - Annual Report for the year ended 31 March 2022
Third Age Health Services Limited (NZX: TAH) advised that it has updated its 2023 Annual Report.
Section 2 of Shareholder and Statutory Information – Substantial Security Holders at page 65 has been
corrected to reflect the number of shares for Michael Haskell & Associates. Page 64 of the Annual Report –
Twenty largest registered shareholders shows the correct number.
An updated version is available from our website by accessing the
following link: https://www.thirdagehealth.co.nz/financial-statements/
Authorised for issue by:
John Fernandes
Chairman
For more information, please contact:
Denice Bennett, CFO – Third Age Health
+64 21 765 303
deniceb@thirdagehealth.co.nz
About Third Age Health
Third Age Health is the leader in providing quality health care services for older people including those living in retirement villages, private
hospitals, secure dementia units as well as in communities across New Zealand. A dedicated Third Age Health clinical team provides onsite
clinics, rostered rounds and after hours on-call healthcare services aimed at supporting the health and wellbeing of older people to
improve quality of life. As well as providing clinical services for over 50 aged care facilities throughout New Zealand, Third Age Health
owns several general practices providing primary healthcare to their local community. www.thirdagehealth.co.nz
---
Contents
FY23 Business summary
03
FY22 Financial summary
04
Chairman & CEO report
05
Expanding horizons: the future of aged care
09
FY23 business & financial highlights
1 0
• General practice update
12
• Clinical quality update
14
Our team & board 1 6
Consolidated financial statements
17
• Directors' responsibility statement
18
• Consolidated statement of comprehensive income
19
• Consolidated statement of changes in equity
20
• Consolidated statement of financial position
21
• Consolidated statement of cash flows
22
• Notes to the consolidated financial statements
23
Independent auditor's report
50
Statement of corporate governance
54
Shareholder and statutory information
64
Corporate directory
69
Third Age Health Services Limited
Directors’ responsibility statement
18
The Directors of Third Age Health Services Limited (the “Company”) are pleased to present to shareholders the
Consolidated Financial Statements for Third Age Health Services Limited and its subsidiaries (“the Group”) for
the year ended 31 March 2023.
The Directors are responsible for presenting financial statements in accordance with New Zealand law and
generally accepted accounting practice, which present fairly in all material respects the financial position of
the Group as at 31 March 2023 and the results of its operations and cash flows for the year ended on that
date.
The Consolidated Financial Statements of the Group have been prepared using accounting policies which have
been consistently applied and supported by reasonable judgements and estimates and all relevant financial
reporting standards have been followed.
The Directors believe that proper accounting records have been kept which enable with reasonable accuracy
the determination of the financial position of the Group and facilitate compliance of the Financial Statements
with the Companies Act 1993, NZX Listing Rules and Financial Markets Conduct Act 2013.
The Directors ensure that they have taken adequate steps to safeguard the assets of the Group and to prevent
and detect fraud and other irregularities. Internal control procedures are also considered to be sufficient to
provide a reasonable assurance as to the integrity and reliability of the Financial Statements.
The Consolidated Financial Statements presented are signed on behalf of the Board on 16 June 2023 by:
John Fernandes
Chairman
Wayne Williams
Audit Committee Chair
Third Age Health Services Limited
Consolidated statement of comprehensive income
For the year ended 31 March 2023
19
2023 2022
Notes $000 $000
Revenue 4 11,217 5,900
Cost of services 5 (5,174) (2,205)
Gross profit
6,043 3,695
Other income
35 30
Employees and contractors 7 (2,814) (1,251)
Professional and consulting fees 8 (503) (486)
Other expenses 9 (970) (262)
Operational expenses
(4,287) (1,999)
Loan impairment 16 (233) -
EBITDA
1,558 1,726
Depreciation 17 (304) (79)
Amortisation of intangibles 18.3 (240) (63)
Finance costs 10 (286) (23)
Profit before income tax
728 1,561
Income tax expense 12 (316) (388)
Profit for the period
412 1,173
Other comprehensive income
- -
Total comprehensive income for the period
412 1,173
Profit and total comprehensive income attributable to:
Shareholders of the parent
439 1,173
Non-controlling interests
(27) -
Profit for the year
412 1,173
Earnings per share 14
Basic earnings per share (cents)
4.39 11.93
Diluted earnings per share (cents)
4.39 11.84
These Consolidated Fin
ancial Statements are to be read in conjunction with the accompanying notes.
Third Age Health Services Limited
Consolidated statement of changes in equity
For the year ended 31 March 2023
20
Share
Capital
Share
Based
Payments
Reserve
Retained
earnings
Non-
controlling
Interest Total
Notes $000 $000 $000 $000 $000
Balance at 1 April 2021
173 607 1,196 - 1,976
Profit for the year
- - 1,173 - 1,173
Total comprehensive income for the year
- - 1,173 - 1,173
Shares issued
342 - - - 342
Dividend
- - (831) - (831)
Tax credit on share based payments
- 21 - - 21
Deferred tax credit on share based payments - 9
- 9
Share based payments
- 6 - - 6
Balance at 31 March 2022
515 643 1,538 - 2,696
Balance at 1 April 2022
515 643 1,538 - 2,696
Profit for the year
- - 439 (27) 412
Total comprehensive income for the year
- - 439 (27) 412
Shares issued 23 81 - - - 81
Dividend 13 - - (647) - (647)
Tax credit on share based payments 12.1 - 4 - - 4
Deferred tax credit on share based payments - (9) - - (9)
Share based payments 24.3 - 8 - - 8
Balance at 31 March 2023
596 646 1,330 (27) 2,545
These Consolidated Financial Statements are to be read in conjunction with the accompanying notes.
Third Age Health Services Limited
Consolidated statement of financial position
For the year ended 31 March 2023
21
2023 2022
Notes $000 $000
Current assets
Cash and cash equivalents
1,355 1,124
Trade and other receivables
15 1,117 386
Loan receivable
16 80 313
Total current assets
2,552 1,823
Non-current assets
Property, plant and equipment
154 22
Right-of-use-assets
17 2,967 1,093
Intangible assets
18 4,351 1,902
Trade and other receivables
15 20 20
Deferred tax asset
- -
Total non-current assets
7,492 3,037
Total assets
10,044 4,860
Current liabilities
Trade and other payables
20 1,395 668
Current tax liabilities
94 55
Employee share purchase plan deposits
24.1 - 75
Bank Loan - current
27 281 -
Lease liabilities
17 283 111
Total current liabilities
2,053 909
Non current liabilities
Trade and other payables 20 2 29
Lease liabilities 17 2,755 977
Deferred tax liability 12.2 630 249
Bank Loan 27 2,060 -
Total non current liabilities
5,447 1,255
Total liabilities
7,500 2,164
Net assets
2,544 2,696
Equity
Share capital
23 596 515
Share based payment reserve
645 643
Retained earnings
1,303 1,538
Equity attributable to the Group
2,544 2,696
Shareholders of the parent
2,549 2,696
Non-Controlling Interests
(5) -
Total Equity
2,544 2,696
These Consolidated Financial Statements are to be read in conjunction with the accompanying notes.
Third Age Health Services Limited
Consolidated statement of cash flows
For the year ended 31 March 2023
22
2023 2022
Notes $000 $000
Cash flows from operating activities
Receipts from operating activities
10,611 5,885
Payments to suppliers and employees
(9,197) (4,147)
Interest received
7 16
Interest paid
(243) (23)
Income taxes paid
(390) (691)
Net cash flows from operating activities 11
788 1,040
Cash flows from investing activities
Payments purchase for property, plant and equipment
(54) (3)
Acquisition of general practices, net of cash acquired
(2,004) (967)
Net cash flows used in investing activities
(2,058) (970)
Cash flows from financing activities
Deposits received under share purchase plan 24 -
72
Share purchase plan deposits applied to acquire shares 24 (
76) (342)
Proceeds from issuing shares
72 342
Principal elements of loan repayments
(37) -
Principal elements of loan receivable repayments
- 47
Payment of lease liabilities 17 (
198) (63)
Dividend paid 13 (
638) (831)
Bank Loan 27 2,378
-
Net cash flows from financing activities
1,501 (775)
Net increase in cash and cash equivalents
231 (705)
Cash and cash equivalents at the beginning of the period
1,124 1,829
Cash and cash equivalents at the end of the period
1,355 1,124
These Consolidated Financial Statements are to be read in conjunction with the accompanying notes.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
23
1. Reporting entity
These Consolidated Financial Statements are for Third Age Health Services Limited and its subsidiaries (the
"Group"). The Parent is incorporated and domiciled in New Zealand and registered under the Companies Act
1993. The parent's shares are publicly traded on the New Zealand Stock Exchange (NZX) and are listed on the
main board of the NZX. The principal trading activity of the Group is the provision of medical services to the
aged care sector. Those companies included in the Group are disclosed in note 19.
The Consolidated Financial Statements of the Group are for the year ended 31 March 2023. The Financial
Statements were authorised for issue by the Directors as dated in the Directors' Responsibility Statement.
2. Statement of accounting policies
2.1. Basis of preparation
The Financial Statements have been prepared in accordance with New Zealand Generally Accepted Accounting
Practice ("NZ GAAP"). They comply with the New Zealand equivalents to International Financial Reporting
Standards ("NZ IFRS") and other applicable Financial Reporting Standards, as appropriate. These Financial
Statements comply with International Financial Reporting Standards ("IFRS") as published by the International
Accounting Standards Board. For the purposes of complying with NZ GAAP, the Group is a for-profit entity.
These Financial Statements have been prepared in accordance with the Financial Markets Conduct Act 2013.
2.2. Basis of measurement
The Financial Statements have been prepared on the historical cost basis except financial instruments and
investment in Phoenix Health Hub that are measured at fair value at the end of each reporting period, as
explained in the accounting policies below.
Historical cost is based on the fair value of the consideration given in exchange for goods and services.
2.3. Basis of consolidation
The Consolidated Financial Statements incorporate the Financial Statements of the Company and entities
controlled by the Company and its subsidiaries. Control is achieved when the Company:
• has power over the investee
• is exposed, or has rights, to variable returns from its involvement with the investee; and
• has the ability to use its power to affect its returns.
The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there
are changes to one or more of the three elements of control listed above.
When necessary, adjustments are made to the Financial Statements of subsidiaries to bring their accounting
policies into line with the Group's accounting policies.
All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between
me
mbers of the Group are eliminated in full on consolidation.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
24
2.4. Functional and presentational currency
The individual Financial Statements of each Group entity are maintained in the currency of the primary
economic environment in which the entity operates (its functional currency). For the purpose of the
consolidated Financial Statements, the results and position of each Group entity are expressed in New Zealand
Dollars (NZD), rounded to thousands, which is the functional currency of the Company and the presentation
currency for the consolidated Financial Statements.
The Group has no foreign operations and the functional currency of all the Group subsidiaries is NZD.
2.5. Goods and services tax (GST)
Revenue, expenses, assets and liabilities are recognised net of the amount of goods and services tax (GST)
except:
• Where the amount of GST incurred is not recovered from the taxation authority, it is recognised as part of
the cost of acquisition of an asset or as part of an item of expense; or
• For receivables and payables which are recognised inclusive of GST (the net amount of GST recoverable
from or payable to the taxation authority is included as part of receivables or payables).
2.6. Financial instruments
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual
provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets
and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the
financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly
attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are
recognised immediately in profit or loss.
Financial instruments are classified into the following specified categories: ‘fair value through profit or loss'
(FVTPL), ‘fair value through other comprehensive income' (FVOCI) and 'at amortised cost'. The classification
depends on the nature and purpose of the financial instrument and is determined at the time of initial
recognition.
The Group’s financial assets consist of cash, short term deposits, trade receivables and related party
receivables.
Financial assets - Cash and short-term deposits
Cash and short-term deposits comprise cash at bank and on hand and short-term deposits with a maturity of
three months or less.
Financial assets - Trade and other receivables
Trade receivables are non-de
rivative financial assets and measured at amortised cost using the effective
interest method less expected credit and loss allowance. Impairment of trade receivables is recorded through
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
25
a loss allowance account (bad debt provision). The amount of the loss allowance is based on the NZ IFRS 9
simplified Expected Credit Loss (ECL) approach which involves the Group estimating the lifetime ECL at each
balance date. The lifetime ECL is calculated using a provision matrix based on historical credit loss experience
and adjusted for forward looking factors specific to the debtors and the economic environment.
Financial assets - Related party receivables
Related party receivables are measured at amortised cost net of any impairment related to credit losses.
Financial liabilities and equity instruments
Financial liabilities and equity instruments - Equi
ty instruments
An equity instrument is any contract that evidences a residual interest in the assets of an entity after
deducting all of its liabilities. Equity instruments issued by the Group are recognised at the proceeds received,
net of direct issue costs.
Financial liabilities and equity instruments - Fin
ancial liabilities
Financial liabilities at amortised cost (including borrowings, related party payables and trade and other
payables) are initially recognised at fair value and subsequently measured at amortised cost using the effective
interest method.
The effective interest method is a method of calculating the amortised cost of a financial liability and of
allocating interest expense over the relevant period. The effective interest rate is the rate that exactly
discounts estimated future cash payments (including all fees and points paid or received that form an integral
part of the effective interest rate, transaction costs and other premiums or discounts) through the expected
life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial
recognition.
Financial liabilities and equity instruments - Derecognition of financial liabilities
The Group derecognises financial liabilities when, and only when, the Group's obligations are discharged,
cancelled or they expire. The difference between the carrying amount of the financial liability derecognised
and the consideration paid and payable is recognised in profit or loss.
2.7. Business combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a
business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair
values of the assets transferred by the Group, liabilities incurred by the Group to the former owners of the
acquiree and the equity interests issued by the Group in exchange for control of the acquiree. Acquisition-
related costs are recognised in profit or loss as incurred.
At the acquisition date, the identifiable assets acquired, and the liabilities assumed are recognised at their fair
value, except deferred tax assets or liabilities, and assets or liabilities related to employee benefit
arrangements which are recognised and measured in accordance with NZ IAS 12 Income taxes and NZ IAS 19
Employee benefits respectively.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
26
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-
controlling interests in the acquiree, and the fair value of the acquirer's previously held equity interest in the
acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the
liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets
acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-
controlling interests in the acquiree and the fair value of the acquirer's previously held interest in the acquiree
(if any), the excess is recognised immediately in profit or loss as a bargain purchase gain.
2.8. Changes in accounting policies
All significant accounting policies have been applied on a basis consistent with those used in the audited
Consolidated Financial Statements of the Group for the year ended 31 March 2022.
2.9. Standards issued but not yet effective
There are new or amended accounting standards mandatory effective 1 January 2023 which the Group has not
adopted earlier.
Amendments to NZ IAS 1 - Presentation of Financial Statements: Disclosure of Accounting Policies
Amendments to NZ IAS 1 - Classification of Liabilities as Current or Non-current
Amendments to NZ IAS 8 - Definition of Accounting Estimates
The Group is yet to assess the full impact of the new standards or amendments issued but not yet effective,
but they are not at this stage expected to have a material impact on the Group.
3. Use of accounting estimates and judgements
The preparation of these Financial Statements requires management to make estimates and assumptions.
These affect the amounts of reported revenue and expense and the measurement of assets and liabilities.
Actual results could differ from these estimates. The principal areas of judgement and estimation in these
Financial Statements are:
• Loan receivable from Third Age Digital Health (note 16)
• Acquisition accounting (note 19.2)
4. Revenue recognition
4.1. Revenue from contracts with customers
Revenue has been categorised as consultation revenue, capitation revenue and other revenue.
Consultation revenue
The Group earns revenue from the provision of medical consultation services. Each consultation performed is
a se
parate performance obligation satisfied at a point in time. The price for each consultation is a fixed amount
based on an agreed rate card with the customer. Revenue is recognised once the consultation service has been
provided. Revenue claims from contracts like ACC and MOH (General medical, maternity and immunisation
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
27
claims) with customers is measured at the fair value of the consideration received or receivable and may be
reduced for rebates and other similar allowances.
Capitation revenue
The Group provides various medical services on a ‘stand ready’ basis on behalf of Primary Health Organisations
(PHOs). This capitation revenue is recognised monthly based on the number of enrolled patients and the
agreed rate for the particular patient. The agreed rate will be affected by the characteristics of the patient, for
example, their age or gender. Revenue is recognised on an over time basis measured on a time lapsed basis.
Other revenue
Other revenue is made up of claims related to vaccinations and other claims recognised on a point in time
basis once the services have been given to the patient.
Revenue from contracts with customers
2023
2022
$000 $000
Capitation revenue
Aged medical care services 1,857
1,519
General practice medical services 2,728
905
Consultation revenue
Aged medical care services 3,961
3,105
General practice medical services 1,851
274
Other revenue
Aged medical care services 130
88
General practice medical services 690
9
Total revenue from contracts with customers 11,217 5,900
Geographical information
Over the two years covered by the Consolidated Financial Statements, the Group operated in New Zealand
only.
Information about major customers
Included in total revenue are revenues that arose from services provided to the Group’s largest customers.
The Group derived revenue from the following significant customers:
2023
2022
$000 $000
Customer 1
1,653 1,287
Customer 2
588 670
No other single customers contributed 10% or more to the Group’s revenue for both 2023 and 2022.
5. Cost of services
Cost of services line include direct costs of doctors, nurses and medical supplies as well as other direct costs.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
28
6. Segment information
6.1. Products and services from which reportable segments derive their revenue
The Group's reportable segments are as follows:
• Aged medical residential care services, being the provision of medical care services to the aged care
sector.
• General practice medical services
6.2. Segment revenues and results
The following is an analysis of the Group’s revenue and results from operations by reportable segment:
Segment revenue 2023 2022
$000 $000
Aged medical care services 5,948 4,712
General practice medical services 5,269 1,188
Total for continuing operations 11,217 5,900
Segment profit before tax 2023 2022
$000 $000
Aged medical care services 567 1,340
General practice medical services 161 221
Total for continuing operations 728 1,561
Segment profit includes the following items:
Segment profit includes the following items:
For the year ended 31 March 2023 Aged care General practice
medical services medical services
$000 $000
EBITDA 713 845
Depreciation (4) (300)
Amortisation of intangibles - (240)
Interest expense on leases - (99)
Interest on ANZ Loan - (144)
Interest on Loss on modification of borrowings - (43)
Profit before tax 709 19
Add back: Loan impairment 233 -
Profit before tax from underlying core operations 942 19
Income tax expense (270) (46)
Profit for the period 439 (27)
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
29
For the year ended 31 March 2022 Aged care General practice
medical services medical services
$000 $000
EBITDA 1,321 385
Depreciation (1) (78)
Amortisation of intangibles - (63)
Interest expense on leases - (23)
Interest income 20 -
Profit before tax 1,340 221
Income tax expense (326) (62)
Profit for the period 1,014 159
EBITDA represents profit before tax excluding amounts for depreciation and amortisation expenses, interest
expenses and interest income.
6.3. Segment assets and liabilities
Segment assets 2023 2022
$000 $000
Aged medical care services incl support functions 2,445 1,513
General practice medical services 8,784 4,014
Total segment assets 11,229 5,527
Intercompany elimination (1,185) (667)
Total segment assets 10,044 4,860
Segment liabilities
2023
2022
$000 $000
Aged medical care services incl support functions 1,048 922
General practice medical services
7,637 1,909
Total segment liabilities
8,685 2,831
Intercompany elimination (1,185) (667)
Total segment liabilities
7,500
2,164
7. Costs of employees, contractors, and directors includes:
2023
2022
Note
$000 $000
Salaries and wages
2,334 916
Short term incentives
40 20
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
30
Defined contribution (KiwiSaver)
132 20
Share based payments expense
24.3
8 13
Employee benefit expense
2,514 969
Contractors
300 305
Former CEO Incentives
- (23)
2,814 1,251
$2,696k of employee benefit expense for doctors and nurses are included in cost of services.
8. Professional and consulting fees
2023 2022
$000 $000
Fees payable to auditor 89 56
Accounting and taxation services 45 121
Legal expenses 92 82
Directors' fees 174 126
Listing and share registry costs 50 39
Company secretarial - 7
CEO Recruitment - 44
Other consultancy costs 53 11
503 486
Fees payable to auditor of $89,400 (2022: $56,650) relates to fees for the annual audit of the Consolidated
Financial Statements and E rnst & Young does not perform other assurance or non-assurance services.
Accounting and taxation services are provided by Deloitte.
Legal expenses include $ 76,480 in respect of acquisition activity during the year ended 31 March 2023 (2022:
$30,342).
9. Other expenses
2023
2022
$000 $000
Technology / IT 426 159
Marketing & PR 15 5
Medical Supplies 129 -
Travel & Entertainment
41 28
Professional operational services 109 -
Office & General 250 70
970 262
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
31
10. Finance costs
2023
2022
$000 $000
Interest expense on leases 144 23
Interest on ANZ Loan 99 -
Interest on Loss on modification of borrowings 43 -
286 23
11. Reconciliation of profit for the year to net cash from operating activities
Reconciliation of profit for the year to net cash from operating activities
2023
2022
$000 $000
Profit before income tax 728 1,561
Adjustments to reconcile profit before tax to net cash flows:
Depreciation and amortisation 304 79
Amortisation of intangibles 240 63
Share based payments expense 8 13
Interest charged on loan - (4)
Loan impairment 233 -
Working capital adjustments:
Trade and other receivables (729) (61)
Trade and other payables 702 83
Impact of working capital acquired (308) (3)
1,178 1,731
Income tax paid (390) (691)
Net cash from operating activities 788 1,040
12. Taxation
12.1. Income tax recognised in profit or loss relating to continuing operations
Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised
in other comprehensive income or directly in equity, in which case, the current and deferred tax are also
recognised in other comprehensive income or directly in equity respectively. Where current tax or deferred tax
arises from the initial accounting for a business combination, the tax effect is included in the accounting for
the business combination.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
32
Tax expense comprises:
2023
2022
$000 $000
Current income tax
435 438
Deferred income tax
(113) (50)
Prior period adjustment
(6) -
Total income tax expense recognised in the current year
316 388
Income tax expense for the year can be reconciled to the accounting profit as follows:
2023 2022
$000 $000
Profit before tax 728 1,561
Income tax expense/(benefit) calculated at 28% 204 437
Effect of non-deductible expenses 110 18
Tax credit on share based payments (4) (67)
Prior period adjustments 6 -
Income tax expense recognised in profit or loss 316 388
12.2. Deferred tax
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in
the Financial Statements and the corresponding tax bases used in the computation of taxable profit. Deferred
tax assets are generally recognised for all deductible temporary differences to the extent that it is probable
that taxable profits will be available against which those deductible temporary differences can be utilised. Such
deferred tax assets are not recognised if the temporary difference arises from the initial recognition (other
than in a business combination) of assets and liabilities in a transaction that affects neither the taxable profit
nor the accounting profit. In addition, deferred tax liabilities are not recognised if the temporary difference
arises from the initial recognition of goodwill.
Deferred tax liabilities are recognised for taxable temporary differences associated with investments in
subsidiaries and associates, and interests in joint ventures, except where the Company is able to control the
reversal of the temporary difference and it is probable that the temporary difference will not reverse in the
foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such
investments and interests are only recognised to the extent that it is probable there will be sufficient taxable
profits against which to utilise the benefits of the temporary differences and they are expected to reverse in
the foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the
ex
tent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the
asset to be recovered.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
33
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in
which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or
substantively enacted by the end of the reporting period.
The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from
the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying
amount of its assets and liabilities.
Deferred tax liability
Deferred tax liability is made up of the following deferred tax assets and liabilities.
2023 2022
$000 $000
Deferred tax asset 957 279
Deferred tax liability (1,587) (528)
(630) (249)
Deferred tax assets relate to:
Provisions and accruals 106 32
Lease Liabilities 851 223
Share based payments - 24
957 279
Deferred tax liabilities relate to:
Right-of-use-assets (831) (218)
Intangible assets (756) (310)
(1,587) (528)
The movement on deferred tax is summarised as follows.
Provisions
and
accruals
Right-of-
use-assets
Leases
Share based
payments
Intangible
assets
Totals
Notes $000 $000 $000 $000 $000 $000
Opening net deferred tax
asset/(liability)
22 (218) 223 24 (310) (259)
Additions through
acquisitions
19.2 - - - - (514) (514)
Recognised in the profit
and loss
84 (613) 628 (15) 68 152
Recognised in the share-
based payments reserve
- - - (9) - (9)
Closing net deferred tax
asset/(liability)
12.2 106 (831) 851 - (756) (630)
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
34
12.3. Imputation credits
The Group had New Zealand imputation credits of $1,075,291 (2022: $710,493) available for use in subsequent
periods.
13. Dividends
Dividends declared and paid during the year ended 31 March
2023:
Cents per share $000
Interim dividend 2.45 244
Final dividend for the year ended 31 March 2022 4.05 403
647
Dividends declared and paid during the year ended 31 March
2022:
Cents per share $000
Interim dividend 4.52 450
Final dividend for the year ended 31 March 2021 3.91 381
831
14. Earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the shareholders of the parent by
the weighted average number of ordinary shares outstanding during the financial year, excluding treasury
shares.
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take
into account the after-income tax effect of interest and other financing costs associated with dilutive potential
ordinary shares, and the weighted average number of ordinary shares that would have been outstanding
assuming the conversion of all dilutive potential ordinary shares.
Reconciliation of earnings used in calculating earnings per share
2023
2022
$000 $000
Net profit attributable to the ordinary shareholders of the
parent
439 1,173
Earnings used in the calculation of basic earnings per share 439 1,173
Weighted average number of shares used as the denominator
2023
2022
Shares Shares
000's 000's
Weighted average number of ordinary shares used as the
denominator in calculating basic earnings per share
9,993 9,832
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
35
Adjustments for calculation of diluted earnings per share:
Employee share options - 74
Weighted average number of ordinary shares and potential
ordinary shares used as the denominator in calculating diluted
earnings per share
9,993 9,906
Share options issued under Employee share options plan are considered as antidilutive.
15. Trade and other receivables
Current
2023
2022
$000 $000
Trade receivables 925 343
Prepayments and other receivables 192 43
1,117 386
As at 31 March 2023 74% of the Group's trade receivables are current (2022: 94%). Short-term receivables
from customers (excluding Ministry funding) are recorded at the amount due, less an allowance for expected
credit losses (ECL). This allowance is calculated using a simplified approach based on a lifetime ECL. Current
provision recorded is immaterial.
Non-current
2023 2022
$000 $000
Deposit with NZX
20 20
20 20
16. Loan receivable
2023
2022
$000 $000
Current 80 313
80 313
Following the failure of TADH to maintain monthly repayments of the loan, the Company sought to have TADH
placed in liquidation during the period, and liquidators were appointed.
While the loan to TADH is unsecured, the Board of TADH provided a written warranty that it had received
legally binding assurances of financial support from its major shareholders such that in the borrower’s opinion
(acting reasonably and in good faith) TADH would make all repayments.
Michael Haskell is the Director of TADH, and its m
ajor shareholders are Michael Haskell & Associates Limited
and Bevan Walsh, both also major shareholders of the Company.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
36
The liquidators have made an interim distribution of $80,000 to the Company after balance date. As it has
been over a year since this issue first arose and since the liquidators have not yet recovered the full amount
and may need to engage in a court process to do so, given the uncertainty around that process the Company
has taken a provision of $233k for the remaining balance of the loan.
17. Right of use assets and lease liabilities
Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset
is available for use by the Group. Each lease payment is allocated between the liability and finance cost. The
finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of
interest on the remaining balance of the liability for each period. The right-of-use asset is depreciated over the
shorter of the asset's useful life and the lease term on a straight-line basis (6-10 years).
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include
the net present value of the following lease payments:
• fixed payments (including in-substance fixed payments), less any lease incentives receivable;
• variable lease payment that are based on an index or a rate;
• amounts expected to be payable by the lessee under residual value guarantees;
• the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
• payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.
The lease payments are discounted using the interest rate implicit in the lease, if that rate can be determined,
or the Group's incremental borrowing rate.
Right-of-use assets are measured at cost comprising the following:
• the amount of the initial measurement of lease liability.
• any lease payments made at or before the commencement date, less any lease incentives received.
• any initial direct costs, and
• restoration costs.
Amounts recognised in the balance sheet
Right-of-use assets
2023
2022
$000 $000
Opening balance
1,093 227
Additions
2,147 606
Lease reassessments
- 334
Depreciation
(273) (74)
Closing balance
2,967 1,093
Lease liabilities
2023
2022
$000 $000
Opening balance
1,088 233
Additions
2,148 583
Lease reassessments
- 334
Interest
143 23
Lease repayments
(341) (85)
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
37
Closing balance
3,038 1,088
Current
283 111
Non-current
2,755 977
3,038 1,088
Amounts recognised in the statement of profit or loss
2023
2022
$000 $000
Depreciation of right-of-use assets property
273 74
Interest expense (included in finance cost)
143 23
The total cash outflow for leases in the 12-month period ended March 2023 was $341,050 ( 2022: $94,342).
The future minimum rentals payable under non-cancellable operating leases are $1,847,285.
18. Intangible assets
2023 2022
Notes
$000 $000
Goodwill 18.1 1,651 796
Intangibles 18.3 2,700 1,106
4,351 1,902
18.1. Goodwill
Goodwill arising on an acquisition of a business is carried at cost as established at the date of acquisition of the
business less accumulated impairment losses, if any.
2023 2022
Note $000 $000
Opening balance
796 408
Additions 18.2 855 388
Closing balance
1,651 796
Goodwill impairment
- -
Net carry amount of goodwill
1,651 796
On disposal of the relevant cash-generating unit, the attributable amount of goodwill is included in the
determination of the profit or loss on disposal.
18.2. Impairment of goodwill
For the purposes of impairment testing, goodwill is allocated to each of the Group's cash-gen
erating units (or
groups of cash-generating units) that is expected to benefit from the synergies of the combination.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
38
A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more
frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-
generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying
amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata based on the
carrying amount of each asset in the unit. Any impairment loss for goodwill is recognised directly in profit or
loss. An impairment loss recognised for goodwill is not reversed in subsequent periods.
Goodwill has been allocated for impairment testing purposes to Hawkes Bay Wellness Centre Limited (HBWC),
Belmont Medical Centre Limited (BMC), Ponsonby Medical (Third Age Health) Limited (PMC), Devonport
Family Medicine (Third Age Health) Limited (DFM) and EastMed St Heliers Limited (EastMed). Each practice is
considered a Cash Generating Unit (CGU).
The allocation of goodwill for each CGU is as follows:
2023 2022
$000 $000
Hawkes Bay Wellness Centre Limited
408 408
Belmont Medical Centre Limited
13 13
Ponsonby Medical (Third Age Health) Limited
375 375
Devonport Family Medicine (Third Age Health) Limited
65 -
EastMed St Heliers Limited
790 -
1,651 796
For the 2023 reporting period, the recoverable amount of the cash-generating units was determined based on
value-in-use calculations which require the use of assumptions. The calculation uses cash flow projections
based on a financial forecast covering a five-year period.
A forecast was generated to model the expected growth of the five CGUs. The following table sets out key
assumptions within the forecast:
Discount Rate
15-18.5% (2022: 15%)
Terminal growth rate 2% (2022: 2%)
EBITDA Growth 5-10% (2022: 10-15%)
The value-in-use is estimated to exceed the carrying amount of HBWC by $2.9 million, BMC by $0.5 million,
PMC by $0.2 million, DFM by $0.6 million and EastMed by $1.6 million. As such, there has been no impairment
of the asset during the year.
18.3. Other intangible assets
Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated
am
ortisation and accumulated impairment losses. Amortisation is recognised on a straight-line basis over their
estimated useful lives. The estimated useful life and amortisation method are reviewed at the end of each
reporting period, with the effect of any changes in estimate being accounted for on a prospective basis.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
39
As a result of the acquisition of general practices, separately identified Intangible assets have been recognised
from the patient enrolled database of the general practices and an ongoing funding agreement with the
Primary Health Organisations (PHOs).
Patient database PHO agreement Total
$000 $000 $000
Cost:
Balance at 31 March 2022 544 786 1,330
Additions 824 1,010 1,834
Disposals/ retirements
- - -
Balance at 31 March 2023 1,368 1,796 3,164
Patient database PHO agreement Total
$000 $000 $000
Accumulated depreciation:
Balance at 31 March 2022 (86) (138) (224)
Amortisation expense (103) (137) (240)
Balance at 31 March 2023 (189) (275) (464)
Carrying amount at 31 March 2023 1,179 1,521 2,700
Carrying amount at 31 March 2022 458 648 1,106
The patient database and PHO agreement are amortised on a straight-line basis over ten years.
19. Business Combinations
19.1. Group composition
The parent entity is Third Age Health Services Limited, a company incorporated in New Zealand. The Group
had the following subsidiaries as of 31 March 2023. The current reporting period includes results from two
new subsidiaries that were not part of the group for the same period last year.
Subsidiary name
Country of
incorporation
Ownership
2023
Ownership
2022
Hawkes Bay Wellness Centre Limited New Zealand
100% 100%
Belmont Medical Centre Limited New Zealand
100% 100%
Ponsonby Medical (Third Age Health) Limited New Zealand
100% 100%
Third Age Employee Share Purchase Plan Trust New Zealand
100% 100%
Devonport Family Medicine (Third Age Health) Limited (acquired 2
May 2022)
New Zealand
100%
-
EastMed St Heliers Limited (acquired 3 October 2022) New Zealand
67%
-
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
40
The Company holds a 10% share in Phoenix Health Hub and is treated as an investment, recorded at fair value
each Balance Date. As per shareholders agreement, the Company has not invested any funds. As of 31 March
2023, the fair value was nil. Phoenix Health Hub Limited is an investment in a Christchurch based clinic to
realise a new integrated general practice and allied health clinic to support unmet health needs.
19.2. Acquisitions
During the financial year ended 31 March 2023 the Company completed two acquisitions of general practices,
to support the Group’s future growth strategy, which revolves around providing a consistent primary health
service as people move from community living into the aged care setting. The acquisition of local general
practices plays an essential part in this, to expand Third Age Health’s offer to people in the local community
and those living independently in retirement villages.
On 2 May 2022 the Company acquired the business and assets of Devonport Family Medicine (DFM) for cash
consideration of $0.4 million and was acquired as a continuation of the Group’s growth strategy, a key
acquisition which will enable the Company to continue to develop the model of healthcare for older people.
The results of the practice since acquisition are included in these Consolidated Financial Statements for the
period ended 31 March 2023, contributing $769,615 to Group revenues and $62,683 to Group EBITDA.
On 3 October 2022 the Company acquired 66.67% share of EastMed St Heliers Limited (“EastMed”) for $1.9
million fully funded through the ANZ loan facility (note 27).
The results of the practice since acquisition are included in these Consolidated Financial Statements for the
period ended 31 March 2023, contributing $1,821,817 to Group revenues and $152,313 to Group EBITDA.
If the clinics was owned for the full year, DFM would contribute $839,580 and EastMed would contribute
$3,643,634 to Group revenues, along with $68,381 and $304,626 to Group EBITDA respectively.
The accounting for the business combination under NZ IFRS 3 Business Combinations has been finalised as at
the date of this report.
Details of the fair value of identifiable assets and liabilities acquired purchase consideration and goodwill are
as follows:
Devonport Family Medicine
EastMed Total
$000 $000 $000
Cash 401 1,930 2,331
Total consideration transferred 401 1,930 2,331
Current assets
Cash - 327 327
Trade receivables - 86 86
Property, plant and equipment - 51 51
Inventory - 10 10
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
41
Non-current assets
Property, plant and equipment 59
3 62
Right of use asset 264 1,884 2,148
Intangible Assets 385 1,449 1,834
Total assets acquired 708 3,810 4,518
Non-current liability
Lease Liability (264) (1,884) (2,148)
Trade and other liabilities - (408) (408)
Non-current liability
Deferred tax liability - 28 28
Deferred tax liability on intangibles (108) (406) (514)
Total net assets acquired 336 1,140 1,476
Goodwill 65 790 855
An assessment of goodwill is tested for impairment annually, or more frequently when there is an indication
that the unit may be impaired, (note 18.2).
Goodwill arises on the acquisition of subsidiaries. Goodwill represents the excess of the purchase
consideration over the fair value of the net identifiable tangible and intangible assets at the time of
acquisition. Management has used its past experience of sales growth and synergistic savings to determine
their expectations for the future. Deferred tax liability of 28% on intangible assets is calculated at the time of
acquisition, the minority interest portion is considered as immaterial.
20. Trade and other payables
Current
2023
2022
$000 $000
Trade payables
180 340
GST payable
272 109
Withholding tax payable
- 10
Accruals and other payables
943 209
1,395 668
Non-current
2023
2022
Note
$000 $000
Liability for cash settled options
24.3 2 7
Accruals and other payables
- 22
2 29
Current trade payables are typically paid within 30 days of the invoice date or on the 20th of the month
fol
lowing the invoice date.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
42
21. Financial instruments
2023
2022
Financial assets Notes
$000 $000
Financial assets at amortised cost
Cash and cash equivalents
1,355 1,124
Trade receivables 15 925 343
Loan receivable 16 80 313
Financial liabilities
Financial liabilities at amortised cost
Trade and other payables 20 907 669
Bank loan 27 2,341 -
Employee share purchase loans 24.1 - 75
21.1. Fair value measurements
As at 31 March 2023, the Group has one investment in Phoenix Health Hub measured at fair value. At 31
March 2022 the Group had no financial assets nor liabilities measured at fair value.
22. Financial risks
This note presents information about the Group's exposure to each financial risk and how those risks are
managed.
22.1. Interest rate risk
Bank loan three tranches of $750,000 are on a fixed rate, therefore are not exposed to market interest rate
volatility. The floating facility of $750,000 of which only $93,739 has been drawn down with a current rate of
9.80% (note 27).
22.2. Credit risk
Credit risk is the risk of the failure of a debtor or counterparty to honour its contractual obligation resulting in
financial loss to the Group.
Financial assets, which potentially subject the Group to credit risk, consist principally of cash and cash
equivalents, trade and other receivables, and loan receivables. The maximum credit risk at 31 March 2022 and
2023 is the carrying value of these assets on the balance sheet. The directors consider the Group's exposure to
credit risk from cash and cash equivalents and trade and other receivables to be minimal given that
• The Group's cash and cash equivalents are held with ANZ, Westpac, BNZ, ASB and Kiwibank. ANZ,
Westpac, BNZ and ASB are all rated AA- based on rating agency Standard & Poors. Standard & Poors no
longer rate Kiwibank, but rating from Moody’s Investor Services and Fitch Ratings are A1 and AA
respectively.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
43
• The Group's customers are typically low credit risk and, historically, there has been minimal bad debt
expense recorded.
22.3. Liquidity risk
The Group manages liquidity to ensure that it has sufficient liquidity to meet its liabilities when due.
Ultimate responsibility for liquidity risk management rests with the board of directors. The Group manages
liquidity risk through continuous cash management and monitoring of forecast and actual cash flows.
22.4. Maturity profile
The following table details the Group’s exposure to liquidity risk.
Contractual maturity dates
On demand Less than one
year
Greater than one
year
Total
Financial liabilities as at 31
March 2023:
Notes $000 $000 $000 $000
Trade and other payables 20 - 907 - 907
Lease liabilities 17 - 487 3,565 4,052
Bank loan 27 94 281 1,966 2,341
94 1,675 5,531 7,300
On demand Less than one
year
Greater than one
year
Total
Financial liabilities as at 31
March 2022: Notes
$000 $000 $000 $000
Trade and other payables 20 - 669 - 669
Employee share purchase plan
deposits 24.1 75 - - 75
Lease liabilities 17 - 111 977 1,088
75 780 977 1,832
22.5. Capital risk management
The Group manages its capital (comprising of cash and cash equivalents) to ensure that entities in the Group
will be able to continue as going concerns while maximising the return to stakeholders through the
optimisation of the debt and equity balance. For the year ended 31 March 2023, the Company has entered
into a $3 million debt facility with ANZ Bank Limited (note 27).
23. Share Capital
Ordinary shares
All ordinary shares rank equally with one vote attached to each fully paid share. Tot
al issued share capital is
10,004,149 ordinary shares (2022: 10,000,000). At 1 April 2021 there were 250,000 shares held for specific
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
44
participants of the Third Age Employee Share Purchase Plan Trust (“Trust”). During the year ended 31 March
2022, 200,000 shares were issued and the remaining 50,000 shares were issued during the year ended 31
March 2023. As at 31 March 2023, of the total number of issued shares, nil (2022: 50,000) were held in trust
for specific participants under the Employee Share Purchase Plan (ESPP, note 24.1).
Treasury shares
Authorised
Issued and shares held Total issued and fully
Share Capital in Trust
paid shares
Note $000 $000 $000 000's
Balance at 1 April 2022
592 (76) 516 10,000
Shares issued 24.1 9 76 84 4
Share issue transaction costs
(4) - (4) -
Balance at 31 March 2023
596 - 596 10,004
Balance at 1 April 2021
592 (418) 173 10,000
Shares issued
- 342 342 -
Balance at 31 March 2022
592 (76) 515 10,000
24. Share Based Payments
24.1. Employee share purchase plan (ESPP)
The Company operated an employee share purchase plan ('ESPP') for certain employees and contractors
('participants'). Under the ESPP, participants are provided with a “loan” to purchase an agreed number of
shares in the Company at a share price established by the Board. The share price is estimated by the Board
based on their assessment of the fair value of the Company at the time. The loans were typically for a 36- or
60-month term, interest free with monthly repayments and were secured against the shares. The shares were
held on trust by the Third Age Employee Share Purchase Plan Trust until such time as the loans were fully
repaid. Participants were permitted to repay the loans at any time. In the event that an employee leaves or is
made redundant or a contractor ceases to provide services then any repayments that have been made were
returned and the allotted shares were returned to the pool. During 2023 the last loan was repaid, the shares
were transferred to the Employee and the scheme was discontinued.
Under NZ IFRS 2 Share-based payment, this type of arrangement is accounted for as an 'in substance' share
option - an equity settled share-based payment. The loans are not recognised as assets of the Company as
they are only secured against the underlying shares and are considered limited in recourse. Instead, the fair
value of the arrangement is calculated at grant date and is recognised over the vesting period of the
arrangement as a share-based payment expense in profit or loss and accumulated in the share-based payment
reserve. The share options vest immediately as there are no service or performance conditions and
participants are able to repay their loans in full at any time and have their shares issued. Partial repayments
made under the loans are recorded as a liability until such time as the loan is repaid in full at which time the
shares are issued, and amounts are recognised as share capital in equity.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
45
2023
2022
$000 $000
Employee share purchase plan deposits
- 75
- 75
Movements in shares held on behalf of participants during the year
Weighted average share
Number of shares purchase price
000's $
Balance at 1 April 2022 50 1.67
Fully paid and issued during the year (50) 1.51
Balance at 31 March 2023 - -
Balance at 1 April 2021 250 1.67
Fully paid and issued during the year (200) 1.71
Balance at 31 March 2022 50 1.67
In December 2022, 50,000 shares priced at $1.71 vested. As a result the deposits received in respect of those
shares was transferred to share capital and the 200,000 shares were transferred from the Third Age Employee
Share Purchase Plan Trust in to the name of the participant.
The share purchase price for shares held on behalf of participants at 31 March 2023 was Nil (2022: $1.51).
There were no share rights granted under the ESSP during the year ended 31 March 2023 (2022: Nil). As at 31
March 2023 nil options remain (2022: 50,000 options).
24.2. Employee Share Option Plan (ESOP)
ESOP - CEO
On the 4 September 2021 (grant date) the Board approved the offer of 300,000 options under a Company
Employee Share Option Plan (ESOP) to the CEO, Tony Wai on the following terms:
• The options were issued at an exercise price of $2.36, based on the Volume Weighted Average Price
(VWAP) for the Company’s shares on the NZX for the 20 Business Days prior to 27 September 2021 (the
date the CEO commenced employment).
• The Options will vest in three tranches, 60,000, 90,000 and 150,000.
• Vesting is subject to continued employment and agreed performance targets achieved by 27 September
2024, 27 September 2025, and 27 September 2026.
• The expiry date of the options will be one year after the date of vesting.
Under the terms of the ESOP there is an option to settle a portion of option in cash, primarily to offset any
income tax liability arising at the time the employee exercises their options. Given current income tax rates it
has been concluded a 39% tax rate will apply. Based on that assumption it is assumed that 39% of each
tranche of options should be treated as cash settled, the remainder will be equity settled.
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
46
Equity-settled options
The total number of equity-settled options is 183,000, which were valued at grant date using the Monte Carlo
simulation valuation model. The fair value of the equity settled options is $43,920 which will be expensed over
the vesting periods for each tranche. The weighted average fair value of the equity settled options is $0.24.
Key estimates and judgements at grant date
The value was calculated using the following significant inputs into the model.
• A share price of $2.24 at the grant date.
• An exercise price simulated to determine a VWAP for the 20 days to 27 September 2021.
• A share volatility of 32.5%, based on daily share price movements since the Company listed on 15
February 2021.
• A dividend yield based on actual dividends issued and assuming a 15% growth rate.
• A risk-free interest rate of 1.45%.
The total amount of fair value recognised in the Consolidated Statement of Comprehensive Income up to 31
March 2023 was $7, 722 (2022: $6,275) with the corresponding entry in the Share Based Payments Reserve.
The weighted average contractual life of the equity-settled options on 31 March 2023 is 45 months (2022: 67
months).
Cash-settled options
The total number of cash-settled options is 117,000 which were valued at grant date using the same inputs as
with the equity settled options. The value at grant date was $28,080, with a weighted average fair value of
$0.24.
Under NZ IFRS for cash-settled options, the Company shall remeasure the fair value of the liability to settle the
options for cash at the end of each full year and half year reporting period and at the date of settlement, with
any changes in fair value recognised in profit or loss for the period.
The fair value of the cash-settled options was remeasured under the Monte Carlo Method as of 31 March
2023. The value at that date was $4,095, with the weighted average fair value of the cash-settled options
being $0.035.
Key estimates and judgements as of 31 March 2023
The remeasured value was calculated using the following significant inputs into the model.
• The valuation date of 31 March 2023.
• A share price at valuation date of $1.60 (2022: $2.84).
• An exercise price of $2.36 being the exercise price of 27 September 2021.
• A share volatility of 32.61% (2022: 29.7%), based on daily share price movements since the Company
listed on 15 February 2021.
• A dividend yield based on actual dividends issued and assuming a 15% growth rate.
• A risk-free interest rate of 4.25% (2022: 3.16%).
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
47
The total amount of fair value recognised in the Consolidated Statement of Comprehensive Income up to 31
March 2023 was $-4,909 (2022: $6,501) with the corresponding entry for the liability under Trade and other
payables (non-current) (note 20).
The weighted average contractual life of the cash-settled options on 31 March 2023 is 45 months.
ESOP - CFO
On 19
th
January 2023 (grant date) the Board approved an offer of 25,000 options with an issue date of 1 April
2023, under a Company Employee Share Option Plan (ESOP) to the CFO, Denice Bennett on the following
terms:
• The options were issued at an exercise price of $2.00
• The Options will vest in three tranches, 5,000, 7,500 and 12,500.
• Vesting is subject to continued employment and agreed performance targets achieved by 1 April 2026, 1
April 2027, and 1 April 2028.
• The expiry date of the options will be one year after the date of vesting.
• There is no obligation for cash settlement
24.3. Share based payments expense
2023
2022
Employee share option plan:
$000 $000
Share based payments expense equity-settled 6 6
Share based payments expense cash-settled 2 7
Employee share purchase plan - -
8 13
25. Related party transactions
25.1. Group composition
The Group is comprised of the following entities:
Subsidiary name
Country of
incorporation
Ownership
2023
Ownership
2022
Hawkes Bay Wellness Centre Limited New Zealand
100% 100%
Belmont Medical Centre Limited New Zealand
100% 100%
Ponsonby Medical (Third Age Health) Limited New Zealand
100% 100%
Third Age Employee Share Purchase Plan Trust New Zealand
100% 100%
Devonport Family Medicine (Third Age Health) Limited
(acquired 2 May 2022) New Zealand
100%
-
EastMed St Heliers Limited (acquired 3 October 2022) New Zealand
67%
-
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
48
The Group's ownership interest in all subsidiaries are equal to its proportion of voting rights held. The Group
has no restrictions relating to its ability to access or use the assets and settle the liabilities of the Group.
25.2. Related party transactions
2023 2022
$000 $000
Michael Haskell, CEO (resigned 30 September 2021) Shareholder Contractor fee - 132
Bonus accruals - (23)
John Fernandes Director & Shareholder Director fees 58 40
Bevan Walsh Director & Shareholder Director fees 27 12
Norah Barlow Director & Shareholder Director fees 39 38
Wayne Williams Director Director fees 49 29
Diane Budres (resigned 19 July 2022) Director & Shareholder Director fees 1 7
Directors’ fees for John Fernandes, Norah Barlow and Wayne Williams also include fees as members of the
Audit Committee. Wayne Williams, Audit Committee Chair, receives a fee of $10,000 per annum, while Norah
Barlow and John Fernandes receive a fee of $2,500 per annum.
Loan receivable from Third Age Digital Health Limited (TADH) (note 16)
Bevan Walsh (Director and Company shareholder), Michael Haskell (former CEO, resigned 30 September 2021
and Company shareholder) and Diane Budres (former Director who resigned 19 July 2022 and Company
shareholder) are all shareholders of TADH which has a loan due to Company. Michael Haskell is also a Director
of TADH. Bevan Walsh advised the Company that he resigned as a director of TADH on 20 December 2021.
25.3. Key management personnel compensation
2023
2022
Short term benefits:
$000 $000
CEO remuneration
Tony Wai 331 151
Michael Haskell (resigned 30 September 2021) - 110
331 261
Other key management personnel 809 436
1,140 697
26. Contingent liabilities and contingent assets
The Group has no contingent liabilities or contingent assets as at 31 March 2023 (2022: Nil).
Third Age Health Services Limited
Notes to the Consolidated Financial Statements
For the year ended 31 March 2023
49
27. Bank Loan
The Company entered into a $3 million debt facility with ANZ Bank New Zealand Limited to provide capital to
support the Group’s planned acquisition strategy. The original term was two years (on a floating rate plus
margin) with a covenant requiring Debt-to-EBITDA ratio (based on 12 “months” results) capped at two times,
tested at each reporting date. On 24 November 2022 the Company completed a restructuring of the $3 million
ANZ loan facility in to 3 loan tranches each $750,000 plus a floating facility of $750,000, on the following terms
and conditions:
1. $750,000 term loan, fixed at a rate of 9.1% for two years;
2. $750,000 term loan, fixed at a rate of 9.36% for two years;
3. $750,000 term loan, fixed at a rate of 9.55% for three years;
4. $750,000 floating loan, at a current rate of 9.80% (base plus 1.56% margin).
Security for the loan is a first ranking security over the Company and the Group which includes cross
guarantees and indemnity of debt. As at 31 March 2023, the Debt to EBITDA ratio was 1.233.
During the period, the loan was drawn to fund the acquisition of Devonport Family Medicine and EastMed
clinics. Total interest charged on the loan in the period was $98,578.
28. Subsequent events
28.1. Final dividend declared
On 29 May 2023 the Board declared a final dividend for the year of 2.58 cents per share taking the total
dividend for the year to 5.03 cents per share.
A distribution of $80,000 was received from the liquidator of TADH on 19
th
April (note 16).
No other matter or circumstances has occurred subsequent to year end that has significantly affected or may
affect, the operations of the Group, the results of those operations or the state of affairs of the entity in
subsequent financial years.
A member firm of Ernst & Young Global Limited
Independent auditor’s report to the shareholders of Third Age Health
Services Limited
Report on the audit of the financial statements
Opinion
We have audited the financial statements of Third Age Health Services Limited (the “Company”) and
its subsidiaries (together the “Group”) on pages 19 to 49, which comprise the consolidated statement
of financial position of the Group as at 31 March 2023, and the consolidated statement of
comprehensive income, consolidated statement of changes in equity and consolidated statement of
cash flows for the year then ended of the Group, and the notes to the consolidated financial
statements including a summary of significant accounting policies.
In our opinion, the consolidated financial statements on pages 19 to 49 present fairly, in all material
respects, the consolidated financial position of the Group as at 31 March 2023 and its consolidated
financial performance and cash flows for the year then ended in accordance with New Zealand
Equivalents to International Financial Reporting Standards and International Financial Reporting
Standards.
This report is made solely to the Company’s shareholders, as a body. Our audit has been undertaken
so that we might state to the Company’s shareholders those matters we are required to state to them
in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than the Company and the Company’s shareholders,
as a body, for our audit work, for this report, or for the opinions we have formed.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand). Our
responsibilities under those standards are further described in the Auditor’s responsibilities for the
audit of the financial statements section of our report.
We are independent of the Group in accordance with Professional and Ethical Standard 1 International
Code of Ethics for Assurance Practitioners (including International Independence Standards) (New
Zealand) issued by the New Zealand Auditing and Assurance Standards Board, and we have fulfilled
our other ethical responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Other than in our capacity as auditor we have no relationship with, or interest in, the Company or any
of its subsidiaries. Partners and employees of our firm may deal with the Group on normal terms
within the ordinary course of trading activities of the business of the Group.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the consolidated financial statements of the current year. These matters were addressed
in the context of our audit of the consolidated financial statements as a whole, and in forming our
opinion thereon, but we do not provide a separate opinion on these matters. For each matter below,
our description of how our audit addressed the matter is provided in that context.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial statements section of the audit report, including in relation to these matters. Accordingly,
A member firm of Ernst & Young Global Limited
our audit included the performance of procedures designed to respond to our assessment of the risks
of material misstatement of the financial statements. The results of our audit procedures, including
the procedures performed to address the matters below, provide the basis for our audit opinion on the
accompanying consolidated financial statements.
Revenue
Why significant How our audit addressed the key audit matter
Revenue is a key focus of shareholders,
directors and management in measuring the
Group’s progress towards its growth objectives.
The Group’s principal revenue stream, the
provision of consultation services, continues to
be recognised at the point in time at which the
service is provided.
The Group’s other significant revenue stream,
the provision of capitation services, is
recognised over time as the service is provided.
Disclosures in relation to the Group’s revenue
are included in Note 4 to the consolidated
financial statements.
In obtaining our audit evidence we:
► evaluated the Group’s processes for
recording consultation and capitation
revenue;
► analysed the correlation between the
Group’s recorded revenue, accounts
receivable and cash using digital audit
techniques;
► selected a sample of revenue transactions
recorded around period end and assessed
whether they had been recorded in the
correct period;
► assessed the Group’s revenue recognition
accounting policies against the requirements
of NZ IFRS 15 Revenue from Contracts with
Customers; and
► evaluated whether the disclosures in relation
to revenue complied with the disclosure
requirements of NZ IFRS 15 Revenue from
Contracts with Customers.
Information other than the financial statements and auditor’s report
The directors of the Company are responsible for the annual report, which includes information other
than the consolidated financial statements and auditor’s report.
Our opinion on the consolidated financial statements does not cover the other information and we do
not express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the
other information and, in doing so, consider whether the other information is materially inconsistent
with the consolidated financial statements or our knowledge obtained during the audit, or otherwise
appears to be materially misstated.
If, based upon the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
A member firm of Ernst & Young Global Limited
Directors’ responsibilities for the financial statements
The directors are responsible, on behalf of the entity, for the preparation and fair presentation of the
consolidated financial statements in accordance with New Zealand Equivalents to International
Financial Reporting Standards and International Financial Reporting Standards, and for such internal
control as the directors determine is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the directors are responsible for assessing on
behalf of the entity the Group’s ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless the directors
either intend to liquidate the Group or cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance,
but is not a guarantee that an audit conducted in accordance with International Standards on Auditing
(New Zealand) will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of these consolidated
financial statements.
A further description of the auditor’s responsibilities for the audit of the financial statements is
located at the External Reporting Board’s website: https://www.xrb.govt.nz/standards-for-assurance-
practitioners/auditors-responsibilities/audit-report-1/. This description forms part of our auditor’s
report.
The engagement partner on the audit resulting in this independent auditor’s report is Lloyd Bunyan.
Chartered Accountants
Auckland
16 June 2023
STATEMENT OF CORPORATE GOVERNANCE
Third Age Health Services Limited
and subsidiaries
Third Age Health Services Limited
Corporate Governance
54
The objective of the Board of Third Age Health Services Limited (“the Company”) is to enhance shareholder
value. The Board considers there is a strong link between good corporate governance and the achievement of
this objective.
The
company seeks to follow the best-practice recommendations for listed companies to the extent that it is
appropriate to the size and nature of the Company’s operations. The best practice principles which the
Company considers in its governance approach are the New Zealand Exchange (NZX) Listing Rules relating to
corporate governance, and the NZX Corporate Governance Code (NZCGC), and the Financial Market
Authority’s Corporate Governance Principles and Guidelines, (altogether “Principles”).
The
Board considers that its corporate governance framework complies with NZCGC recommendation, except
as stated within this report. This report is presented by addressing the eight principles and the associated
recommendations of the NZCGC.
The
information in this report is current as at the date of release of the Annual Report for the year ended 31
March 2023 and has been approved by the Board.
The
key corporate governance documents referred to in this report are available under the investors section of
the Company’s website at https://www.thirdagehealth.co.nz
Principle 1 – Code of Ethical Behaviour
Recommendation 1.1
“The Board should document minimum standards of ethical behaviour to which the issuer’s directors and
employees are expected to adhere (a code of ethics).
The code of ethics and where to find it should be communicated to the issuer’s employees. Training should be
provided regularly. The standards may be contained in a single policy document or more than one policy.
The code of ethics should outline internal reporting procedures for any breach of ethics, and describe the
issuers’ expectations about behaviour, namely that every director and employee:
a.acts honestly and with personal integrity in all actions;
b.declares conflicts of interest and proactively advises of any potential conflicts;
c.undertakes proper receipt and use of corporate information, assets and property;
d.in the case of directors, give proper attention to the matters before them;
e.acts honestly and in the best interest of the issuer, as required by law, and takes account of interests of
shareholders and other stakeholders;
f.adheres to any procedures around giving and receiving gifts (for example where gifts are given that are of
value in order to influence employees and directors, such gifts should not be accepted);
g.adheres to any procedures about whistle blowing (for example, where actions of a whistle blower have
complied with the issuer’s procedures, an issuer should protect and support the, whether or not action is
taken): and
h.manages breaches of the code”
The
Company complies with this recommendation with a Code of Ethics which was published in March 2022.
Directors observe and foster high ethical standards. The Company expects its directors, officers, and
employees to act legally, to maintain high ethical standards, and to act with integrity consistent with the
Company’s policies, guiding principles and values.
Third Age Health Services Limited
Corporate Governance
55
The Company adopts policies to ensure it maintains high standards of performance and behaviour when
dealing with the Company’s customers, suppliers, shareholders and staff. The specific governance policies in
place throughout the year were a Diversity and Inclusion policy, Market Disclosure Policy and the Financial
Products Trading policy.
The
Code of Ethics can be found on the investor section of the Company’s website
(https://www.thirdagehealth.co.nz).
Recommendation 1.2
“An issuer should have a financial product dealing policy which applies to employees and directors.”
The
Company complies with this recommendation. The Financial Products Trading Policy can be found on the
investor section of the Company’s website (https://www.thirdagehealth.co.nz
).
Principle 2 - Board composition & Performance
Recommendation 2.1
“The board of the issuer should operate under a written charter which sets out the roles and responsibilities of
the board. The board charter should clearly distinguish and disclose the respective roles and responsibilities of
the board and management.”
The
Company complies with this recommendation, with the board operating under a Board charter which is
available on the investor section of the Company’s website (https://www.thirdagehealth.co.nz
).
Recommendation 2.2
“Every issuer should have a procedure for the nomination and appointment of directors to the board.”
The
Company complies with this recommendation. The Board has decided that these functions will be carried
out by the main board within the terms of reference of this Board Charter. A copy of the Board Charter is
available on the investor section on the Company’s website (https://www.thirdagehealth.co.nz
).
Recommendation 2.3
“An issuer should enter into written agreements with each newly appointed director establishing the terms of
their appointment.”
The
Company complies with this recommendation. All current Directors and senior executives have entered
into written agreements with the Company setting out the terms of their appointment. In accordance with the
NZX Listing Rules, all Directors are required to retire (though may be re-elected) not later than the third annual
meeting following the Director’s appointment, or after three years, whichever is longer. Any Directors
appointed by the Board since the previous annual meeting must also retire and are eligible for election.
Recommendation 2.4
“Every issuer should disclose information about each director in its annual report or on its website, including
profile of experience, length of service, independence and ownership interest and director attendance at Board
meetings.”
The
Company complies with this recommendation. The biographies of the Directors are available in this
Annual Report and on the Company’s website (https://www.thirdagehealth.co.nz).
Third Age Health Services Limited
Corporate Governance
56
With regard to Board meeting attendance, the Board meets as often as it deems appropriate, including
sessions to review the performance of the business, to consider the strategic direction and to approve annual
budgets. As is common nowadays, video conferences are mostly used, which also suits the dispersed nature of
the Board and management.
The table below sets out Director attendance at Board meetings during FY23, including meetings to approve
strategic plans, budgets and the release of annual and half year results.
Director Number of meetings
eligible to attend
Number of meetings
attended
Bevan John Walsh 7 7
John Samuel Ronny Fernandes 7 7
Norah Kathleen Barlow 7 7
Wayne Geoffrey Williams 7 7
Diane Lynn Budres (resigned 19 July 2022)
2 2
Recommendation 2.5
“An issuer should have a written diversity policy which includes requirements for the board or a relevant
committee of the board to set measurable objectives for achieving diversity (which at a minimum should
address gender diversity) and to assess annually both the objectives and the entity’s progress in achieving
them. The issuer should disclose the policy or a summary of it.”
The company complies with this recommendation, though the company is still developing measurable diversity
and inclusion objectives that it can review and report against annually. A written policy can be found on the
investor section of the Company’s website (https://www.thirdagehealth.co.nz
).
NZX listed issuers are required to report quantitative data on the gender breakdown of Directors and Officers
at the financial year end. The policy behind the rule is to provide information to allow investors to maintain an
informed view of diversity as a factor relevant to an Issuer’s expected performance.
As at 31 March 2023 the mix of male and female of the Board and Company’s Key Management Personnel (the
CEO and persons that report to the CEO) was as follows:
2023 2022
Male Female Male Female
Non-executive Directors 3
1
3
2
Key Management Personnel
5 6
4 5
Recommendation 2.6
“Directors should undertake appropriate training to remain current on how to best perform their duties as
directors of an issuer.”
Members of the Board undertake regular professional training to remain current on how best to perform their
duties. The Company encourages all Directors to undertake appropriate training and education so that they
may best perform their duties. This may include attending presentations on changes in governance, legal and
regulatory frameworks; attending technical and professional development courses; site visits and briefings
from key executives; and attending presentations from industry experts and key advisers.
Third Age Health Services Limited
Corporate Governance
57
Recommendation 2.7
“The Board should have a procedure to regularly assess director, board, and committee performance.”
The Board have introduced an assessment process to enable an annual assessment of the Directors, and the
Board plus senior executives.
The Board considers individual and collective performance, together with the
skill sets, training and development and succession planning required to govern the business.
Recommendation 2.8
“A majority of the Board should be independent directors.”
The Company complies with this recommendation. In determining directors’ independence, the Board has
applied factors outlined in the commentary to Corporate Governance Code recommendation 2.4.
The Board currently comprises four Directors, three of whom are independent:
• Bevan John Walsh, Chairman, Non-independent Director.
• John Samuel Ronny Fernandes, Independent Director.
• Norah Kathleen Barlow, Independent Director.
• Wayne Williams, Independent Director.
Directors’ interests disclosed for the financial year ended 31 March 2023 are provided in the Shareholder and
Statutory Information section of this Annual Report.
Recommendation 2.9
“An issuer should have an independent chair of the Board. If the chair is not independent, the chair and the
CEO should be different people.”
During the year ended 31 March 2023, the Company complied with this recommendation for the majority of
the year with John Fernandes being appointed as new Chairman 10 August 2022. While Bevan Walsh as Chair
for the first few months of the year is not independent, it is noted that the Chair and CEO are different people.
The Board has determined that Bevan John Walsh (Chair) is not independent by virtue of his significant
shareholding.
Principle 3 – Board Committees
Recommendation 3.1
“An issuer’s audit committee should operate under a written charter. Membership on the audit committee
should be a majority of independent directors and comprise solely of non-executive directors of the issuer. The
Chair of the audit committee should be an independent director and not the chair of the board.”
The Company complies with this recommendation. The board operates an Audit Committee which provides a
forum for effective communication between the Board and external auditors. The Committee reviews the
annual and half-yearly financial statements, prior to their approval by the Board, the effectiveness of internal
control, the Company finance function, information systems, and the efficiency and effectiveness of the audit
function.
During the year ended 31 March 2023 the Committee comprised of Wayne Williams (Chair and Independent
Director, appointed 10 August 2022), Norah Barlow (Independent Director) and John Fernandes (Independent
director). The Audit Committee Charter can be found on the investors section of the Company’s website
(https://www.thirdagehealth.co.nz
).
Third Age Health Services Limited
Corporate Governance
58
The table below sets out Director’s attendance at Audit Committee meetings during FY23.
Director Number of meetings
eligible to attend
Number of meetings
attended
Wayne Geoffrey Williams
3 3
Norah Kathleen Barlow
3 3
John Samuel Ronny Fernandes
3 3
Recommendation 3.2
“Employees should only attend the audit committee at the invitation of the audit committee.”
The Company complies with this recommendation. Employees and other non- members of the committee
only attend by invitation.
Recommendation 3.3
“An issuer should have a remuneration committee which operates under a written charter (unless this is carried
out by the whole board). At least a majority of the remuneration committee should be independent directors”.
Given the size and nature of the Board there is no standing committees for remuneration, but the Board has
decided that these functions will be carried out by the main Board within the terms of reference of the Board
Charter. A copy of the Board Charter is available on the investors section of the Company’s website
(https://www.thirdagehealth.co.nz
).
Recommendation 3.4
“An issuer should establish a nominations committee to recommend director appointments to the Board
(unless this is carried out by the whole Board) which should operate under a written charter. At least a
majority of the nominations committee should be independent directors.”
Given the size and nature of the Board there is no standing committee for nominations, but the Board has
decided that these functions will be carried out by the main board within the terms of reference of the Board
Charter.
A copy of the Board Charter is available on the investor section of the Company’s website
(https://www.thirdagehealth.co.nz).
Recommendation 3.5
“An issuer should consider whether it is appropriate to have any other board committees as standing
committees. All committees should operate under written charters. An issuer should identify the members of
each of its committees, and periodically report member attendance.”
The Board will continue to assess the requirements for further standing committees.
The Board will use
standing committees where this will enhance its effectiveness in key areas, while still retaining Board
responsibility.
Recommendati
on 3.6
“The board should establish appropriate protocols that set out the procedure to be followed if there is a
takeover offer for the issuer including any communication between insiders and the bidder. The board should
disclose the scope of independent advisory reports to shareholders. These protocols should disclose the option
of establishing an independent takeover committee, and the likely composition and implementation of an
independent takeover committee.”
Third Age Health Services Limited
Corporate Governance
59
In the case of a takeover offer, the Company will form an Independent Takeover Committee to oversee
disclosure and response and engage expert legal and financial advisors to provide advice on procedure. The
Company does not have a formal Takeover Response Policy at this stage and so is not compliant with this
recommendation.
Principle 4 - Reporting and disclosure
Recommendation 4.1
“The issuer’s board should have written continuous disclosure policy.”
The Company complies with this recommendation. The Company’s directors are committed to keeping
investors and the market informed of all material information about the Company and its performance, in a
timely manner. The company has adopted a Market Disclosure Policy to ensure that material information is
identified, reported, assessed and, where required, disclosed to the market in a timely manner. A copy of the
Policy is available on the investors section of the Company’s website (https://www.thirdagehealth.co.nz
).
Recommendation 4.2
“An issuer should make its code of ethics, board and committee charters and the policies recommended in the
NZX Code, together with any other key governance documents, available on its website.”
The Company complies with this recommendation. Published policies and charters are found the investor
section of the Company’s website ( https://www.thirdagehealth.co.nz
).
Recommendation 4.3
“Financial reporting should be balanced, clear and objective. An issuer should provide non-financial disclosures
at least annually, including considering environmental, economic, and social factors and practices. It should
explain how operational or non-financial targets are measured. Non-financial reporting should be informative,
include forward looking assessments, and align with key strategies and metrics monitored by the board.”
In addition to all information required by law, the Company also seeks to provide meaningful information to
ensure stakeholders and investors are well informed, including financial and non-financial information.
Financial Information
Senior Management is responsible for implementing and maintaining appropriate accounting and financial
reporting principles, policies, and internal controls designed to ensure compliance with accounting standards
and applicable laws and regulations.
The Board’s Audit Committee oversees the quality and integrity of external financial reporting, including the
accuracy, completeness, balance and timeliness of financial statements. It reviews the Company’s full and half
year financial statements and makes recommendations to the Board concerning accounting policies, areas of
judgement, compliance with accounting standards, stock exchange and legal requirements, and the results of
the external audit.
For the financial year ended 31 March 2023, the Directors believe that proper accounting records have been
kept that enable the determination of the Company’s financial position with reasonable accuracy and facilitate
compliance of the financial statements with the Financial Markets Conduct Act 2013.
The Company’ full and half year financial statements are available on the investor section of the Company’s
website (https://www.thirdagehealth.co.nz
).
Third Age Health Services Limited
Corporate Governance
60
Non‑financial information
The Company sets out, reports against and discusses its strategic objectives in a variety of communications
including the Chair and CEO’s commentary in reports to shareholders.
Principle 5 – Remuneration
Recommendation 5.1
“An issuer should recommend director remuneration to shareholders for approval in a transparent manner.
Actual director remuneration should be clearly disclosed in the issuer’s annual report.”
The Company complies with this recommendation. Remuneration of Directors and senior executives is a key
responsibility of the Board. The Board ensures that remuneration is benchmarked to the market for Director
and Board positions.
Recommendation 5.2
“An issuer should have a remuneration policy for remuneration of directors and officers, which outlines the
relative weightings of remuneration component and relevant performance criteria.”
The Company complies with this recommendation.
Director remuneration
The total remuneration pool available for Directors was fixed at listing at a current maximum of $180,000 per
annum for all non-executive Directors. The Board determines the level of remuneration paid to Directors from
that pool. Directors also receive reimbursement for reasonable travelling, accommodation and other expenses
incurred in the course of performing their duties.
Any proposed increases in pool of fees for non-executive Director fees and remuneration will be put to
shareholders for approval. If independent advice is sought by the Board, it will be disclosed to shareholders as
part of the approval process.
Board role approved remuneration
The fees payable to a non-executive Chair currently amount to $60,000 per annum, fees payable to the
Independent and Non-Independent Directors are $35,000 per annum. The Chair of the Audit Committee
receives $10,000 per annum while members receive $2,500 per annum.
Executive remuneration
In general, executive remuneration comprises a fixed base salary, an at-risk short-term incentive payable
annually linked to business performance and incentives linked to longer term share growth. At-risk incentives
are paid against targets agreed with executives at the commencement of the period and are based on financial
measures, mainly earnings targets.
Recommendation 5.3
“An issuer should disclose the remuneration arrangements in place for the CEO in its annual report. This should
include disclosure of base salary, short term incentives and long-term incentives and the performance criteria
used to determine performance-based payments.”
The Company complies with this recommendation. The CEO remuneration is detailed und
er note 25.3 of the
Consolidated Financial Statements.
Third Age Health Services Limited
Corporate Governance
61
Principle 6 - Risk Management
Recommendation 6.1
“An issuer should have a risk management framework for its business and the issuer’s board should receive and
review regular reports. An issuer should report the material risks facing the business and how these are being
managed.”
The Board has overall responsibility for the Company’s system of risk management and internal control. The
Board delegates day-to-day management of the risk to the CEO.
Risk Identification
The senior management team is required to regularly identify the major risks affecting the business and
develop structures, practices, and processes to manage and monitor these risks. The CEO provides an updated
risk register at each Board meeting.
Insurance
The Company maintains insurance policies that it considers adequate to meet its insurable risks.
Recommendation 6.2
“An issuer should disclose how it manages it’s health and safety risks and should report on its health and safety
risks, performance and management.”
The Company complies with this recommendation, with formal reporting to the board on it’s health and safety
risks, performance and management at Board meetings.
Principle 7 – Auditors
Recommendat
ion 7.1
“The board should establish a framework for the issuer’s relationship with its external auditors. This should
include:
a. For sustaining communication with the issuer’s external auditors;
b. To ensure that the ability of the external auditors to carry out their statutory audit role is not impaired, or
could reasonably be conceived to be impaired;
c. To address what, if any services (whether by type or level) other than their statutory audit roles may be
provided by the auditors to the issuer: and
d. To provide for the monitoring and approval by the issuer’s audit committee of any service provided to the
issuer other than in their statutory audit role.”
The Company complies with this recommendation. The Board is committed to ensuring audit independence,
both in fact and appearance, so that the Company’s external financial reporting is viewed as being highly
objective and without bias. The Audit Committee reviews the quality and cost of the audit undertaken by the
Company’s external auditors and provides a formal channel of communication between the Board, senior
management, and external auditors.
The Audit Committee approves the auditor’s terms of engagement, audit partner rotation (at least every five
yea
rs) and audit fee and reviews and provides feedback in respect of the annual audit plan. The Audit
Committee periodically has time with the external auditor without management present. The Committee also
assesses the auditor’s independence on an annual basis.
Third Age Health Services Limited
Corporate Governance
62
All audit work of the Company is fully separated from non-audit services to ensure that appropriate
independence is maintained. There were no other services provided by EY in FY23. The amount of fees paid to
EY for audit and non-audit work are identified on note 8 of the Consolidated Finance Statements.
EY has provided the Committee with written confirmation that, in its view, it was able to operate
independently during the year.
Recommendation 7.2
“The external auditor should attend the issuer’s Annual Meeting to answer questions from shareholders in
relation to the audit.”
The Company complies with this recommendation. EY will be invited to attend the FY23 Annual Shareholders’
Meeting and will be available to answer questions from shareholders at the meeting.
Recommendation 7.3
“Internal audit functions should be disclosed.”
The Company has a number of internal controls which are overseen by the Audit Committee and/or the Board.
These include controls for business continuity management, insurance, health and safety, conflicts of interest,
and prevention and identification of fraud. Given the size of the business the Company does not have an
internal audit function but last year engaged professional advisors Deloitte to undertake a review of internal
controls and will consider undertaking further reviews in the future.
Principle 8 – Shareholder rights and relations
Recommendation 8.1
‘An issuer should have a website where investors and interested stakeholders can access financial and
operational information and key corporate governance information about the issuer.”
The Company complies with this recommendation. The Company’s website can be found at
https://www.thirdagehealth.co.nz
.
Recommendation 8.2
“An issuer should allow investors the ability to easily communicate with the issuer, including the option to
receive communications from the issuer electronically.”
The Company complies with this recommendation. The Board is committed to open and regular dialogue and
engagement with shareholders. The Company seeks to ensure that investors understand its activities by
communicating effectively with them and giving them access to clear and balanced information.
The Company has a calendar of communications and events for shareholders, including but not limited to:
• Half and full Year Results Announcements and Annual Report.
• Market announcements.
• Annual Shareholders’ Meeting.
• Scheduled and ad hoc investor presentations to institutional investors and retail brokers.
• Easy access to information through the Company’s website ( https://www.thirdagehealth.co.nz
).
• Access to management and the Board via a dedicated email address, investors@thirdagehealth.co.nz.
Recommendation 8.3
Third Age Health Services Limited
Corporate Governance
63
“Quoted equity security holders have the right to vote on major decisions which may change the nature of the
issuer in which they are invested.”
The Company complies with this recommendation. Shareholders are actively encouraged to attend the Annual
Shareholders’ Meeting and may raise matters for discussion at this event and may vote on major decisions that
affect the Company. Voting is by poll, upholding the ‘one share, one vote’ philosophy.
In accordance with the Companies Act 1993, the Company’s Constitution and the NZX Main Board Listing
Rules, the Company refers major decisions that may change the nature of the Company to shareholders for
approval. All shareholders are given the option to elect to receive electronic communications from the
Company. In addition to shareholders, the Company has a wide range of stakeholders and maintains open
channels of communication for all audiences, including brokers, the investing community, regulators, staff,
customers and suppliers.
Recommendation 8.4
“If seeking additional equity capital, issuers of quoted securities should offer further equity securities to existing
equity security holders of the same class on a pro rata basis and no less favourable before further equities are
offered to other investors.”
In the event that the Company will seek additional equity capital, the Company will seek to offer further equity
securities to existing equity security holders of the same class on a pro rata basis and no less favourable before
further equities are offered to other investors.
Recommendation 8.5
“The board should ensure that the notices of annual or special meetings of quoted equity security holders is
posted on the issuer’s website as soon as possible and at least 20 working days prior to the meeting.”
The Company has complied with this recommendation.
Third Age Health Services Limited
Shareholder and statutory information
64
1. Additional information required under the NZX Listing Rules
Twenty largest registered shareholders as of 31 March 2023
The Company has one class of equities, Ordinary Shares listed on the NZX Main Board under the ticker code
TAH.
The following table shows the names and holdings of the 20 largest registered holdings of listed ordinary
shares of the Company on 31 March 2023.
Shareholders Holding % of issued
capital
Bevan John Walsh 4,311,731 43.10%
Michael Haskell & Associates Limited 2,569,973 25.69%
Timothy Grant Livingstone & Robert Peter Webber 840,500 8.40%
New Zealand Depository Nominee 378,926 3.79%
Diane Lynn Budres 248,392 2.48%
Lenore Deirdre Bauer 156,500 1.56%
Jsrf Limited 127,328 1.27%
Brian Hezelton Walsh 125,767 1.26%
Jiahuan Fu 118,540 1.18%
FNZ Custodians Limited 101,480 1.01%
Terence De Silva 65,150 0.65%
Xzs Holdings Limited 44,000 0.44%
Bruce John Mccullagh 37,049 0.37%
Custodial Services Limited 36,000 0.36%
Dellow Nominees Limited 33,400 0.33%
Tony Andrew Wai 32,903 0.33%
James Kai Wah Tee 31,404 0.31%
Gore Holdings Limited 25,000 0.25%
Norah Kathleen Barlow & Robert Noel Barlow 24,490 0.24%
Dean Neil Edgerton & Nicole Tonnile Edgerton & William Desmond Edgerton 24,000 0.24%
9,332,533 93.26%
The total number of voting securities of the Company at 31 March 2023 was 10,004,149 ordinary shares which
are listed on the NZX.
Third Age Health Services Limited
Shareholder and statutory information
65
Spread of shareholders as at 31 March 2023
The following table is the spread of listed shareholders as of 31 March 2023
Shareholder size Number of Holders Total Shares listed % of listed capital
1-1,000 81 35,917 0.4%
1,001-5,000 70 207,580 2.1%
5,001-10,000 28 238,731 2.4%
10,001-50,000 21 477,634 4.8%
50,001-100,000 1 65,150 0.7%
Greater than 100,000 10 8,979,137 89.8%
211 10,004,149 100.0%
Shareholding of Directors as of 31 March 2023
Director
2022 2021
Shares Shares
Bevan John Walsh
4,311,731 4,329,617
John Samuel Ronny Fernandes
137,328 91,168
Norah Kathleen Barlow
24,490 24,490
Wayne Geoffrey Williams
- -
Dianne Budres resigned as a Director on 19 July 2022. On 31 March 2022 she held 248,392 shares.
2. Additional information required under the Financial Markets Conduct Act
2013
Substantial Security Holders
Information on Substantial Security Holders is provided pursuant to section 293 of the Financial Markets
Conduct Act 2013 (the “Act”) and details the Substantial Security Holders in the Company and their relevant
interests in the Company’s shares as of 31 March 2023. A person has a substantial holding for the purposes of
the Act if the person has a relevant interest in quoted voting products that comprise 5% or more of a class of
quoted voting products of the listed issuer.
Investor name Shares held
at 31 March 2023
% of issued
capital
Bevan John Walsh 4,311,731 43.10%
Michael Haskell & Associates Limited 2,569,973 25.69%
Timothy Grant Livingstone & Robert Peter Webber (W W Flaunty Family A/c) 840,500 8.40%
Lenore Deirdre Bauer
Beneficial ownership
1
1,514,972
Direct ownership 156,500
1,671,472 16.80%
1. This relates to an informal agreement relating to the beneficial ownership of a share of the shares held by Bevan John Walsh, the
exercise of voting rights attaching to those Share, and any acquisition or disposal of those Shares
Third Age Health Services Limited
Shareholder and statutory information
66
3. Additional information required under the Companies Act 1993
Directors’ remuneration and other benefits
The names of the directors of the Company who held office and the details of their remuneration and value of
other benefits received for services to Third Age Health Services Limited for the year ended 31 March 2023
were:
Board Fees Audit Committee
Fees
$ $
John Samuel Ronny Fernandes
53,750 3,125
Wayne Geoffrey Williams
41,000 8,125
Bevan John Walsh
29,250 -
Norah Kathleen Barlow
35,000 2,500
Diane Lynn Budres (resigned 19 July 2022)
1,580 -
160,580 13,750
Interests register
Directors have given notices disclosing interests pursuant to section 140(1) of the Companies Act 1993.
Particulars of entries recorded in the Company’s Interests Register during the financial year ended 31 March
2023 are set out in the following table.
Director Nature of disclosure
Bevan John Walsh 1 Bevan Walsh is a major shareholder of The Company TAH and Third Age
Digital Health Limited (TADH). Bevan Walsh resigned as a director of TADH on
20 December 2021. The Company is owned money from TADH. Details of the
loan are provided in note 16 of the Consolidated Financial Statements.
2 Indemnified to the extent allowed by the Companies Act 1993 and the
company constitution.
3 Directors and Officers insurance cover provided by the Company
John Samuel Ronny Fernandes 1 Indemnified to the extent allowed by the Companies Act 1993 and the
company constitution.
2 137,328 Shares (1.37%) in the Company held by JSRF Limited, in which John
Fernandes has a relevant interest as sole director and shareholder.
3 JSRF Limited (a company owned 100% by John Fernandes) holds an option to
purchase a further 100,000 Shares (1.03%) held by another shareholder (who
is not a director or senior manager) at $2.15 per Share. That option can be
exercised in part or in full at any time until 30 June 2024.
4 Directors and Officers insurance cover provided by the Company
Third Age Health Services Limited
Shareholder and statutory information
67
Director Nature of disclosure
Norah Kathleen Barlow 1 Norah Barlow holds a position as CEO of a client of the Company
2 24,490 (0.24%) shares in the Company held by Norah Kathleen Barlow and
Robert Noel Barlow in their capacities as trustees of a family trust associated
with Norah Barlow
3 Indemnified to the extent allowed by the Companies Act 1993 and the
company constitution.
4 Directors and Officers insurance cover provided by the Company
Wayne Geoffrey Williams 1 Indemnified to the extent allowed by the Companies Act 1993 and the
company constitution.
2 Directors and Officers insurance cover provided by the Company
Indemnity and insurance
The Company has entered into deeds of indemnity in favour of all its directors. The Company has insured all its
directors against liabilities and costs in accordance with section 162(5) of the Companies Act 1993.
Employees’ remuneration
The number of employees or former employees, not being Directors of the Group, who received remuneration
and other benefits in their capacity as employees, the value of which exceeds $100,000 is set out below:
2023 2022
Number Number
$100,000 - $109,999 2 -
$110,000 - $119,000 2 -
$120,000 - $129,000 1 -
$130,000 - $139,000 1 -
$140,000 - $149,000 - -
$150,000 - $159,000 1 -
$160,000 - $169.000 - 1
$170,000 - $179,000 - -
$180,000 - $189,000 1 -
$190,000 - $199,000 - -
$200,000 - $209,000 1 -
$210,000 - $219,000 - -
$220,000 - $229,000 1 -
$230,000 - $239,000 - -
$240,000 - $249,000 - -
$250,000 - $259,000 2 -
$260,000 - $269,000 - -
$270,000 - $279,000 - -
$280,000 - $289,000 - -
$290,000 - $299,000 1 -
Third Age Health Services Limited
Shareholder and statutory information
68
Amount payable to auditors
The amount payable to our auditor is $82,400 (2022: $56,650).
Donations
The Company made no donations during the year ended 31 March 2023.
Third Age Health Services Limited
Corporate directory
69
Registered office
536 Kennedy Road
Greenmeadows Napier
New Zealand Company number
3189884
Directors
Bevan John Walsh (Chairman, Non-independent)
John Samuel Ronny Fernandes (Independent)
Norah Kathleen Barlow (Independent)
Wayne Geoffrey Williams (Independent)
Auditors
Ernst & Young
EY Building, 2 Takutai Square
Britomart
Auckland 1010
New Zealand
Registry
Link Market Services Securities Registrar
Level 11, Deloitte Centre
80 Queen Street Auckland 1010
www.linkmarketservices.co.nz
Phone:(09) 375 5998
Email: enquiries@linkmarketservices.co.nz
Legal advisors
DLA Piper New Zealand
50-64 Customhouse Quay
Wellington 6140
New Zealand
www.dlapiper.com/en/newzealand/
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.
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